INR supported by weak greenback overseas

The Indian rupee appreciated 20 paise to close at 87.43 (provisional) against the US dollar on Wednesday, as a weak greenback and a positive momentum in domestic equity markets supported. Domestic shares eked out modest gains after official data showed India's consumer price inflation eased more-than-expected in July to the lowest level in just over eight years, bringing inflation below RBI's tolerance band and raising prospects of another interest rate cut. Firm global cues and a weaker dollar also underpinned sentiment as in-line U.S. inflation data cemented expectations of interest rate cuts by the Federal Reserve in September. The benchmark BSE Sensex rose 304.32 points, or 0.38 percent, to 80,539.91. The broader NSE Nifty index ended up 131.95 points, or 0.54 percent at 24,619.35. Besides, weak crude oil prices and cooling domestic inflation supported the rupee, but uncertainties over trade tariffs and foreign fund outflows capped the sharp upside for the domestic unit. At the interbank foreign exchange, the rupee opened at 87.63, and oscillated between an intraday low of 87.72 and a high of 87.28 against the American currency.

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